Keystone XL pipeline takes second shot at U.S. OK

CALGARY, Alberta (Reuters) - TransCanada Corp is taking its second shot at asking Washington to approve the contentious Keystone XL oil pipeline, betting that a new route through Nebraska and post-U.S. election time frame for a decision will push the project forward.

The reapplication to the U.S. State Department on Friday comes after Canada's largest pipeline company carved the proposal into two parts in hopes of kickstarting the project.

U.S. President Barack Obama rejected the full $7.6 billion project early in this election year as concerns spread about the proposed northern portion of the route near an aquifer in Nebraska. Obama has expressed support for the southern portion.

TransCanada has been negotiating with Nebraska state officials over a new route and hopes to have U.S. State Department approval for the northern part of the line early next year with the aim of putting it in service by the end of 2014 or early 2015. That portion would cost $5.3 billion.

The company pointed out that 10,000 pages of study from the first review concluded Keystone XL would have minimal impact on the environment, so the application need not be bogged down again.

"Certainly the message we've heard coming out of the State Department and out of the White House is that they fully expect to use as much of the pre-existing record from the previous application as possible," Alex Pourbaix, president of TransCanada's pipeline division, told Reuters.

"When we look at that we think that the lion's share of that information remains current and relevant and provides all of the analysis that the State Department would require to make their decision."

The move angered environmentalists, who had claimed the last rejection as a victory in a battle against what they say are oil spill risks and rising greenhouse gas emissions from oil sands development. Last year they staged noisy protests against the project in Washington and elsewhere, leading to some arrests.
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